Labour attacks outsourcing “obsession” as test and trace failures highlighted

Rachel Reeves has attacked the Tories for an “obsession with outsourcing” as a parliamentary committee criticised the “unimaginable” cost of NHS test and trace despite its failure to deliver on the promise to avoid lockdowns.

The public accounts committee report published today identified shortfalls in the Covid tracing system, which received another £15bn cash injection in the Budget last week in addition to the £22bn already allocated to the service.

The damning report found that “there is still no clear evidence” to judge the effectiveness of test and trace and concluded that “it is unclear whether its specific contribution to reducing infection levels… has justified its costs”.

The cross-party committee reported that NHS test and trace publishes many figures on its performance but these do not demonstrate how effective the service is at reducing transmission of coronavirus.

“The Department of Health and Social Care justified the scale of investment, in part, on the basis that an effective test and trace system would help avoid a second national lockdown; but since its creation we have had two more lockdowns,” the report reads.

In its summary, the committee criticised the service as being “still overly reliant on expensive contractors and temporary staff”, highlighting that it still had 900 contractors on the books from Deloitte alone in January.

Commenting on the findings, Reeves said: “This report reveals how this government’s outsourced, Serco-led test and trace system failed the British people and led our country into restrictive lockdown after lockdown.

“It underlines the epic amounts of waste and incompetence, an over-reliance on management consultants, taxpayers’ cash splashed on crony contracts, all while ministers insist our NHS heroes deserve nothing more than a clap and a pay cut.”

Echoing Labour calls to “sack Serco”, the Shadow Chancellor of the Duchy of Lancaster added: “The Conservatives’ wasteful obsession with outsourcing must end and contact tracing should be run by our public health teams.”

Unite the Union’s Gail Cartmail described the document as “scathing” and highlighted that ministers had repeatedly been advised to allow local public health teams to take over the management of Covid tracing in their areas.

Labour urged the government in October to “ditch Serco and let councils and local public health teams run contact tracing” following reports that the largely privatised system was only having a “marginal impact” on stopping transmission.

“Members of the public will be rightly asking why billions are available for Tory mates to fail miserably, while NHS staff are denied a fair pay rise after months of selfless public service,” Cartmail added this morning.

Rishi Sunak recommended a 1% pay rise for NHS staff at the Budget, going back on the government commitment to a 2.1% pay rise outlined in the NHS long-term plan. The move amounts to a real-terms pay cut as it does not keep up with inflation.

Labour’s Jonathan Ashworth said on Monday that the failure of the government to deliver on its commitment to the 1.4 million employees who currently work in the health service shows that “you simply can’t trust the Tories with the NHS”.

UNISON general secretary Christina McAnea said the committee “makes clear many lives were lost because of government failings” and stressed that those on the frontline had not been supplied with personal protective equipment.

“Care workers were forced make their own safety kit, buy it themselves or go without, putting themselves, their families and the people they looked after at huge risk,” she said. “The distress and fear this caused cannot be overstated.”

TUC general secretary Frances O’Grady said the refusal of the government to raise the level of sick pay in the UK, which is among the lowest in Europe, “massively undermined” the test and trace programme.

“Ministers must urgently raise statutory sick pay to the level of the real living wage and make everyone eligible,” she demanded. “The government’s plans to reopen the UK will be in jeopardy if people aren’t able to self-isolate.”

Labour has criticised the government for “not paying people decent sick pay to isolate themselves”, calling for ministers to expand eligibility for the £500 test and trace support payment to anyone without access to workplace sick pay.

Public accounts committee chair Meg Hillier MP stressed the need to see “costs better controlled”, described the sum spent as “unimaginable” and warned that “British taxpayers cannot be treated by the government like an ATM machine”.

“Test and trace cannot point to a measurable difference to the progress of the pandemic, and the promise on which this huge expense was justified – avoiding another lockdown – has been broken, twice,” she said.

“Not only is it essential it delivers an effective system as pupils return to school and more people return to their workplace, but for the £billions spent we need to see a top class legacy system.”

The report found that despite the focus on the roll-out of rapid testing in different community settings, the service had “significantly underestimated” the increase in demand when schools and universities returned last September.

The 22-page paper released today also outlined that despite the money spent on the programme, total laboratory testing capacity remained under 65% in November and December – at the lower end of what the service itself stated is best practice.

The committee reported that the outsourced service “still struggles to consistently match supply and demand for its test and trace services, resulting in either sub-standard performance or surplus capacity”.